Mid-year Bump in Standard Mileage Rate
The Internal Revenue Service (IRS) has announced that the optional standard mileage rate for employees who use their own cars for business purposes will increase for the final six months of 2011.
The new rate will be at 55.5 cents per mile for all business miles driven from July 1, 2011 through December 31, 2011. This is an increase of 4.5 cents from the 51 cent rate in effect for the first six months of 2011.
The IRS says it made the special adjustment because of recent gasoline price increases. The agency normally updates the mileage rate once a year in the fall for the next calendar year. Employers who use the standard mileage rate to reimburse employees may deduct the reimbursement as a business expense.
Also for the next six months, the rate for miles driven for medical or moving purposes will increase from 19 cents a mile to 23.5 cents. The rate for miles driven in service of charitable organizations is set by statute, not by the IRS, and remains unchanged at 14 cents a mile.
The new rates are included in Announcement 2011-40 on the optional standard mileage rates.
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